B. have been approved by the Internal Revenue Service C. have substantial authoritative support D. are proven theories of accounting

3) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:

Income Statement Balance Sheet Dr. Cr. Dr. Cr.Totals $58,000 $48,000 $34,000 $44,000 To enter the net income (or loss) for the period into the above worksheet requires an entry to the __________.

A. income statement credit column and the balance sheet debit column

B. income statement debit column and the balance sheet credit column

C. income statement debit column and the income statement credit column

D. balance sheet debit column and the balance sheet credit column

4) These are selected account balances on December 31, 2008.

Land (location of the corporation's office building)$150,000

Land (held for future use)225,000

Corporate Office Building900,000

Inventory300,000

Equipment675,000

Office Furniture150,000

Accumulated Depreciation450,000

What is the net amount of property, plant, and equipment that will appear on the balance sheet?

A. $1,425,000 B. $1,950,000 C. $2,400,000 D. $1,650,000

5) The first step in activity-based costing is to __________.

A. identify the cost driver that has a strong correlation to the activity cost pool B. assign manufacturing overhead costs for each activity cost pool to products C. identify and classify the major activities involved in the manufacture of specific products

D. compute the activity-based overhead rate per cost driver

6) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s break even point?

A. 2,133 units B. 4,600 units C. 6,200 units D. $25,600

7) Sam's Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?

A. $8,250 B. $5,250 C. $750 D. $4,500

8) These are selected account balances on December 31, 2008.

Land (location of the corporation's office building)$100,000

Land (held for future use)150,000

Corporate Office Building600,000

Inventory200,000

Equipment450,000

Office Furniture100,000

Accumulated Depreciation300,000

What is the net amount of property, plant, and equipment that will appear on the balance sheet?

A. $950,000 B. $1,300,000 C. $1,600,000 D. $1,100,000

9) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals: Income StatementBalance Sheet

A. permanent or real accounts only B. permanent accounts only C. both permanent and temporary accounts D. temporary accounts only

10) As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?

A. the same on the date of acquisition B. never the same C. the same when the asset is sold D. irrelevant when the asset is used by the business in its operations

12) One of Astro Company's activity cost pools is machine setups, with estimated overhead of $150,000. Astro produces sparklers (400 setups) and lighters (600 setups). How much of the machine setup cost pool should be assigned to sparklers?

A. $90,000

B. $150,000 C. $60,000 D. $75,000

13) The cost principle is the basis for preparing financial statements because it is __________.

A. the most accurate measure of purchasing power B. a conservative value C. relevant and objectively measured, and verifiable D. an international accounting standard

14) Which one of the following items is not generally used in preparing a statement of cash flows?

18) A country's consumption possibilities frontier can be outside its production possibilities frontier if __________.

A. the country imports more than it exports B. the country’s technology is superior to the technologies of other countries C. the citizens of the country have a greater desire to consume goods and services than do the citizens of other countries

D. the country engages in trade

19) When, in a particular market, the law of demand and the law of supply both apply, the imposition of a binding price ceiling in that market causes quantity demanded to be __________.

20) If a binding price ceiling were imposed in the computer market, __________.

A. the quality of computers would increase B. the supply of computers would decrease C. the demand for computers would increase D. a shortage of computers would develop

21) For a college student who wishes to calculate the true costs of going to college, the costs of room and board __________.

A. plus the cost of tuition, equals the opportunity cost of going to college B. should be counted only to the extent that they are more expensive at college than elsewhere

C. should be counted in full, regardless of the costs of eating and sleeping elsewhere

D. usually exceed the opportunity cost of going to college

22) In the market for foreign-currency exchange in the open economy macroeconomic model, the amount of net capital outflow represents the quantity of dollars __________.

A. demanded for the purpose of importing foreign goods and services B. supplied for the purpose of buying assets abroad C. supplied for the purpose of selling assets domestically D. demanded for the purpose of buying U.S. net exports of goods and services

23) The part of the balance of payments account that records the amount of foreign currency the government buys or sells is the:

29) Sebastian Stabilio just joined a team of people from throughout his organization whose primary task is to recommend valuable uses for the scrap generated in the manufacturing process. The team meets twice per week; otherwise members work within the usual organizational structure. The team, not permanent, which Sebastian has joined, would be considered a:

A. Parallel team B. Project team C. Working group D. Work team E. Project group

30) An invisible barrier that makes it difficult for certain groups, such as minorities and women, to move beyond a certain level in the organizational hierarchy is referred to as the:

35) A manager's ability to stimulate people to be high performers is referred to as:

A. Supervising B. Planning C. Controlling D. Leading E. Organizing

36) The best way for an employer to find out if a potential employee can do a job is by __________.

A. using a performance simulation test B. using the interview process C. administering an IQ test D. having them spend a day in the office E. using a written test

37) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true?

A. All entrepreneurs need venture capital in order to get started B. Anyone can start a business C. Successful entrepreneurs take very careful, calculated risks D. Money should not be considered a start-up ingredient E. Entrepreneurs are their own bosses and completely independent

38) One study found that manufacturing labor costs about _____ an hour in China, compared to _____ dollars in the United States.

A. Less than $1; about 40 B. Less than $1; about 15 C. $2; about 25 D. Less than $1; about 25 E. About $2; about 15

39) One of the most important contributors to total quality management has been the introduction of statistical tools to analyze the causes of product defects in an approach called:

41) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:

42) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median income per capita). His estimated regression equation was Crime = 428 + .050 Income.

Assuming b1 is significant, if Income decreases by 1000 we would predict that Crime will __________.

46) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.

For this sample, which measure of central tendency is least representative of the “typical” student?

A. Midrange B. Mean C. Median D. Mode

47) Jolly Blue Giant Health Insurance (JBGHI) is concerned about rising lab test costs and would like to know what proportion of the positive lab tests for prostate cancer are actually proven correct through subsequent biopsy. JBGHI demands a sample large enough to ensure an error of ± 2% with 90% confidence. What is the necessary sample size?

A. 2,401

B. 609 C. 1,604 D. 1,692

48) Which one of the following statements concerning production and staffing plans is best?

A. The impact of production and staffing plans cuts across several functional areas of the firm.

B. Production and staffing plans specify production rates, workforce levels, and inventory holdings, but do not account for capacity limitations because they are aggregated.

C. Production and staffing plans attempt to achieve several objectives, all of which must be consistent with one another.

D. When production and staffing plans are made, aggregation can be performed only along two dimensions: products and time.

49) Likely reasons for inaccurate control limits would include which of the following?

A. Process variation was not zero, as expected. B. The engineers were underpaid for their work. C. The engineering parameter for variance is unknown. D. There was insufficient preliminary sampling.

50) The one-worker, multiple machines approach functions as:

A. a way to create uniform workstation loads. B. a production bottleneck. C. a one-person production line. D. a poka-yoke device.

52) While glancing over the sensitivity report, you note that the stitching labor has a shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If your original right hand value for stitching labor was 30 hours, you know that:

A. you would lose $80 if one of your workers missed an entire 8 hour shift. B. you can send someone home 6 hours early and still pay them the $60 they would have earned while on the clock.

C. the next worker that offers to work an extra 8 hours should receive at least $80.

D. you would be willing pay up to $60 for someone to work another 6 hours.

53) The force behind globalization in _____ was the amount of muscle, horsepower, wind power, or steam power that a country could deploy.

57) The Global, Web-Based Platform enables individuals to do which of the following?

A. all of these are true B. produce and sell goods and services C. exchange knowledge D. access information, services, and entertainment E. connect, compute, communicate, collaborate, and compete everywhere and all the time

58) The management cockpit best exemplifies which type of system?

A. Group decision support system B. Functional area information system C. Digital dashboard D. Expert system

E. Decision support system

59) _____ is the acquisition and efficient use of resources in accomplishing organizational goals.

60) International Game Technology’s new ERP system produced all of the following benefits except:

A. Operations employees were able to access manufacturing process details at their workstations

B. The company gained flexibility in manufacturing products C. ERP system connected the company’s global operations D. Company was able to maintain its original business processes E. Integrated the company’s business functions

64) Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:

Cost of debt8%

Cost of preferred stock12%

Cost of common stock16%

Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?

A. $1,568 B. $463 C. $1,241 D. $871

65) Disadvantages of using current liabilities as opposed to long-term debt include:

66) Bell Weather, Inc. has a beta of 1.25. The return on the market portfolio is 12.5%, and the risk-free rate is 5%. According to CAPM, what is the required return on this stock?

A. 15.62% B. 20.62% C. 14.37% D. 9.37%

67) Dublin International Corporation’s marginal tax rate is 40%. It can issue three-year bonds with a coupon rate of 8.5% and par value of $1,000. The bonds can be sold now at a price of $938.90 each. The underwriters will charge $23 per bond in flotation costs. Determine the approximate after-tax cost of debt for Dublin International to use in a capital budgeting analysis.

A. 9.2% B. 5.1% C. 8.5% D. 6.0%

68) Forward rates are quoted:

A. on financial statements B. in direct form and at a premium or discount C. by the FDIC D. in an indirect form E. daily

69) Tri State Pickle Company preferred stock pays a perpetual annual dividend of 2 1/2% of its par value. Par value of TSP preferred stock is $100 per share. If investors’ required rate of return on this stock is 15%, what is the value of per share?

A. $6.00 B. $37.50 C. $16.67 D. $15.00

70) Suppose you determine that the NPV of a project is $1,525,855. What does that mean?

A. The project’s IRR would have to be less that the firm’s discount rate. B. In all cases, investing in this project would be better than investing in a project that has an NPV of $850,000.

C. Under all conditions, the project’s payback would be less than the profitability index.

D. The project would add value to the firm.

71) According to the hedging principle, permanent assets should be financed with _____ liabilities.

A. fixed B. permanent C. current D. spontaneous

72) Exchange rate risk:

A. doesn’t affect trades made in US Dollars. B. arises from the fact that the spot exchange rate on a future date is a random variable.

C. applies only to certain types of domestic businesses.

D. has been phased out due to recent international legislation.

73) The common stockholders are most concerned with:

A. the spread between the return generated on new investments and the investor’s required rate of return.

B. the percentage of profits retained. C. the size of the firm’s beginning earnings per share. D. the risk of the investment.

74) Which of the following is most consistent with the hedging principle in working capital management?

A. Fixed assets should be financed with short-term notes payable. B. Inventory should be financed with preferred stock. C. Accounts receivable should be financed with short-term lines of credit. D. Borrow on a floating rate basis to finance investments in permanent assets.

79) A cluster analysis of the "toothpaste market" would probably show that:

A. most consumers are concerned about cost. B. most consumers are mainly concerned about brightness of teeth. C. the broad product-market can be served effectively with one marketing mix. D. factors such as taste, price, and "sex appeal" are not important. E. different market segments seek different product benefits.

A. one must consider the society’s role in the marketing system. B. one must determine how efficiently the society's resources are used.

C. the best approach is to consider the profit generated by individual firms within the overall system.

D. the evaluation is necessarily subjective. E. one must consider each individual firm's role in the marketing system.

86) Marketing:

A. not important if you have a good product. B. reflects existing social values in the short run--while reinforcing these values in the long run.

C. turns consumers into puppets. D. creates materialistic values which did not exist before. E. is only propaganda.

87) Clustering techniques applied to segmenting markets __________.

A. doesn’t apply to demographic data B. eliminate the need for marketing managers to specify in advance what dimensions might be relevant for grouping consumers

C. remove the need for managerial judgment D. usually require computers to group people based on data from market research

E. is time consuming and expensive

88) Product disparagement differs from defamation of a nonpublic figure in that:

A. Intent is only required in a disparagement case. B. Publication to a third party is required in the defamation case, but not in the disparagement case.

C. Publication to a third party is required in the disparagement case, but not in the defamation case.

D. Intent is required for the disparagement case, but not in the defamation case.

E. Intent is required for the defamation case, but not in the disparagement case.

89) Mary arrived at work one day, and her boss said to her, “That’s the ugliest dress I have ever seen. Because you wore that to work today, you are fired.” Assuming that Mary is an at-will employee, which of the following is true?

A. Mary can be fired only if it is in the best interest of the employer. B. If none of the exceptions to the at-will rule apply, Mary can be fired. C. If Mary has the will to work, she cannot be fired without cause. D. Mary can be fired for any reason.

90) Which of the following is correct about interpretive rules?

A. Interpretive rules are not subject to judicial review. B. All federal administrative agencies have implied power to make interpretive rules.

C. They must be accompanied by substantive rules.

D. They do not establish new law.

E. They require public notice and participation to create.

91) In responding to a constitutional challenge to the Computer Decency Act, the U.S. Supreme Court ruled that:

A. The Internet was similar to television and that restrictions similar to those on television programming were appropriate.

B. The Act was unconstitutional because its provisions were too vague to define.

C. Obscene materials could not be available between 6:00 a.m. and 10:00 p.m. local time.

D. Computers and the Internet were not covered by the free speech provisions of the U.S. Constitution because they did not exist when the Constitution was drafted.

E. The Act was constitutional because obscene speech receives no protection.

92) In a criminal proceeding, what is the difference between an indictment and an information?

A. An indictment requires proof beyond a reasonable doubt, but an information does not.

B. A grand jury issues an indictment, but does not issue an information. C. Guilt or innocence is determined in an indictment, but not in an information. D. The defendant is charged with a crime in an indictment, but not in an information.

93) Which social responsibility theory has been advocated by Novel Prizewinning economist Milton Friedman?